“Winners Take None:” Coworking, Self Storage, Scooters Have Burned Billions of Investor Dollars and Maybe Were Never ‘Tech Companies’
The historical dynamic for software markets was one of ‘winner take all/most.’ Economies of scale, network effects, soft monopolies/bundling, patent moats: there are many reasons why. Putting your money into one of these leading companies could produce incredible returns over time for venture, institutional, and retail investors. In some twisted way then, the opposite of these companies (Oracle, Google, Meta, Microsoft, Apple, Salesforce for example) would be ‘winner take none’ outcomes. Verticals where an incredible value of investor wanted was single-minded and plane the ‘best/surviving’ companies ended up consuming a tremendous value of dollars.
Sometimes a winner take none market can sally when a technology transilience just didn’t pan out, or there’s a dramatic transpiration in consumer needs/expectations. But other times, and through the most recent cycle, it seems like some of the most dramatic ones were just blitzscaling aimed the wrong target. Narratives and spreadsheets which somehow would take low margin, upper stock-still forfeit businesses and transform them into technology companies.
Self-storage on Demand. Winner take none.
Micromobility Scooters. Winner take none.
Coworking. Winner take none.
As a venture investor these are expressly painful considering they goof slow, urgent a lot of wanted and time and hope withal the way. Early in Homebrew’s existence we had a mini Winner Take None in the consumer/SMB shipping space, so I’ve got some familiarity with these situations and don’t midpoint to just throw stones at others.
What crush these mistakes? Besides ZIRP, there’s often the using of a merchantry model from one success to a market that’s not as well suited. The “Uber for X” and “Airbnb for X” largely lacked positive nature that transportation and travel possessed and therefrom found infrequent usage, low margins, ramified processes and so forth. Winner take none.
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